Venture Debt: The Essential Guide for Founders

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Startup Success: A Podcast for Founders & Investors 34 min 1 speaker 3 chapters transcribed 14 days ago
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Unknown 0:01
Welcome to Startup Success, the podcast for startup founders and investors. Here you'll find stories of success from others in the trenches as they work to scale some of the fastest growing startups in the world. Stories that will help you in your own journey. Startup Success starts now.
Kate Adams 0:18
Today I am joined by Marshall Hawkes, author of the new book Venture Debt Deals. Marshall is a longtime leader in venture lending. He has more than a decade of experience at Silicon Valley Bank across private credit, relationship management, and leadership. In this episode, we break down what venture debt really is, when it makes sense in a startup's capital strategy, and how founders should navigate today's evolving venture debt landscape. Marshall shares a practical, behind-the-scenes look at how lenders think, the mistakes founders often make, and the principles every founder should understand before signing a venture debt deal. I listened to Marshall's new book, Venture Debt Deals, and really enjoyed it, particularly the use case studies.
Kate Adams 1:22
From his career on when a startup benefited from venture debt. Please welcome Marshall Hawks to the show. Thanks, Marshall, for being here today. I'm looking forward to get into the details of VentureDeb. But before we do that, I think it would be helpful if we could get a quick overview of your background and then what inspired you to write this book.
Marshall Hawks 1:47
Sure. Hey Kate. Good to be on the Berkeley Startup Success podcast. Thank you. It's a bit surreal, ironically, because I have been a 20-year venture bank and venture lender until I started to write this book and left that industry. But I go back far enough. I used to have hair and it wasn't gray. For those of you looking at the video of this, I'm a very bald, grayed-out, bearded guy. And I I worked with Jeff Birkland, the namesake of Birkland Associates, when it was just him and there was no business more than fifteen years ago. So sorry for making Jeff now old with me, but I'm it's exciting to be uh on the on the podcast for this great firm that you guys have built.
Kate Adams 2:28
Thank you, thank you.
Marshall Hawks 2:29
Yeah, I've had a lot long time in venture banking and lending across four different firms. Most recently, and for the majority of that time, I was at Silicon Valley Bank or SVB, the sort of dominant player in the banking and lending to startup industry. We had our fun moment in the sun in March of 2023, but I stayed on for a couple of years after that before leaving to write this book. And really the impetus for this was another book called Venture. Deals by Brad Feld and Jason Mendelson, that probably a lot of your audience might already know. And maybe they have a copy or two on their bookshelf like I do. It's been out for about 14 years now, and it really pulled back the cover on venture capital fundraising and what that looks like, what you're gonna see in a term sheet, how do investors think?
Marshall Hawks 3:13
How are they structured? A lot of that stuff 15 years ago was very opaque, and you couldn't, as an entrepreneur, Or CFO founder, um, you didn't have a lot of insight into you sort of how the venture capital world works. Now there's a lot more transparency in that process, largely because of that book, as well as you know, a lot of other people have written about the industry since then. Anyway, that book came out. I thought there should be a book like that on venture debt. Took me a solid 14 years to r get up the courage to leave my day job. And write that book with the help of some other folks along the way. Uh, but that is really the inspiration for putting pen to paper. And I was fortunate enough to have Brad Feld help in some of the early drafts, um, provide some commentary to what I was writing until the point where I was locking the manuscript.
Marshall Hawks 4:03
And then he's the top blurb on the back. So I feel very fortunate to be alongside or getting the help from some very um smart people, people who are smarter than me, that is, uh, on the the topic. But that was sort of the inspiration why I wanted to get the book out to the broad masses.

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